ABSTRACT Great progress has been made in manipulating the immune system to eliminate established tumors including hepatocellular cancer (HCC). However, the lack of a clinically-relevant animal model largely impedes our understanding of HCC-induced immune evasion. Therefore, prevention of tumor-induced immunotolerance to develop effective immunotherapies against HCC is still a challenging task. We recently created a novel murine model with immunocompetent mice. This model reflects most typical features of human HCC including immune escape. Tumor growth in this model induces profound immune tolerance characterized by increase in the frequency of tumor-associated macrophages (TAMs), regulatory T cells (Tregs) and myeloid-derived suppressor cells (MDSCs), liver sinusoidal endothelial cells (LSECs) as well as profound exhaustion of effector CD8+T cells. We have thus established a unique platform to investigate the mechanism of tumor-induced immune tolerance and to develop proof-of-concept therapeutic strategies for HCC toward eventual clinical translation. Ceramide has tumoricidal activity. We use advanced nanotechnology to make nanoliposome-loaded C6- ceremide (LipC6). The formulated LipC6 overcomes ceramide cell impermeability and aqueous precipitation, while enhancing cellular retention, promoting its clinical use as a drug. The combination of LipC6 with adoptive transfer of tumor antigen-specific CD8+ T-cell plus immunization with tumor-specific antigens not only retarded tumor growth but also regressed established tumors, suggesting that the combination of LipC6 with immunotherapies has a synergistic therapeutic effect in HCC control. The overall objective of this proposal is to dissect the underlying mechanisms by which LipC6 breaks tumor-induced immune tolerance to rescue antitumor immune activity and develop a clinically useful LipC6-integrated immunotherapy for HCC. Further studies reveal that LipC6 treatment modulates TAM and LSEC in cellular level; and regulates reactive oxygen species (ROS), interferon regulator factor (IRF), and fatty acyl-COA reductase 2(Far2), PD1 in molecular level in HCC. Anti-PD1 antibodies treatment effectively impedes HCC growth. Thus, we hypothesize that LipC6 targets TAM and LSEC to resurrect anti-tumor immune reactivity by regulating ROS, IRF, and Far2 pathways; thus LipC6 in combination with anti-PD1 antibodies to block PD1/PD-L1 pathway not only strongly activate anti-HCC immunity but also result in unprecedented therapeutic efficacy. We will test our hypothesis through aims 1: Dissect the cellular mechanisms by which LipC6 modulates TAM and LSEC to impact anti-tumor immunity in tumor-bearing mice. 2. Dissect the molecular mechanisms by which LipC6 modulates macrophages through ROS and IRF pathways, and LSEC through Far2 pathway in the setting of HCC. 3. Define the therapeutic efficacy of LipC6 in combination with anti-PD-1 Abs for HCC treatment and elucidate the underlying mechanisms. This study will provide better insights into the mechanisms of an effective LipC6-immunotherapeutic intervention in HCC control. The findings will lead to new treatments and therapeutic targets, and better anticancer strategies.